AGYS - Earnings call transcript Q3 2025

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Operator

Good day, ladies and gentlemen. Welcome to the Agilysys 2025 Third Quarter Conference Call.

As a reminder, today's conference may be recorded. [Operator Instructions].

I would now like to turn the conference over to Jessica Hennessy, Senior Director of Corporate Strategy and Investor Relations at Agilysys.

begin. may You

Jessica Hennessy

and the Towanda, everybody. you Thank Thank XXXX good Third joining Agilysys Quarter for you, afternoon, Conference Call.

started doing read We comments. get in minute a will with But before safe so, the me let harbor language. just managed

will Securities today's to as of regarding including Litigation the Reform made within and protection harbor our made predictive statements call Act statements are be financial Some of forward-looking safe on intended be the guidance. Private XXXX,

ability based results believes and on subject ability maintain that company filed Although and materially. on to other that from to forward-looking results increase our statements with risks uncertainties meet statements the are vary Form Important actual assumptions, and Securities its are ability these the reasonable the to statements sales, profitability to XX-K to that our forward-looking the company's such levels reports forth could the to factors and levels, provided in set XX-Q risks reports Commission. include cause materially cause and our could actual Exchange guidance differ

references focused reminder, in year time made to period XXXX. transformation Agilysys financial entirely levels during and any company this to call after a As the an to the software business solutions refer hospitality only record fiscal

turn ahead. With Ramesh that, to of go please I'd now to the Mr. over CEO call Ramesh, like Srinivasan, President Agilysys. and

Ramesh Srinivasan

evening. Good Jes. Welcome to Earnings the you, Call. Third Thank XXXX fiscal Quarter

Atlanta today call our the headquarters Dave on me at and Jes Wood, is Joining CFO.

in before revenue details. discussing is these let first sales and our calls, As usual me practice cover other

below highest the XXXX selling sales annual QX, which highest. QX third was our terms. the or value preceding in Fiscal success sales measure sequentially We quarter ever, slightly second was contract

and December expectations. previous sales best and sales This revenue but was in food to bargained quarter. of of coming below to successful QX transformation quarter Sales disappointing December lot more a we to in bridge QX POS sales the very out sales to Fiscal related expectations, our quarter to best the ever the was less products better how POS mainly POS despite during old period. July ever QX XXXX turned levels to sales than short technology The of vertical. our than October like October the Just well one was with fell process September was Fiscal tough services levels sales challenging crossing new POS for. XXXX be point-of-sale due a managed QX. POS than

on near-term past We sales working currently will soon. are significant get phase this current POS challenging several opportunities. We confident we remain

the to POS expect sales then next to We from levels normal and improve there. return during on few further quarters

new of going unified has With the installations and one and newer properties only not versions Virtually, the all involved very approved combined for for modernized our customer, well. current who their implementations POS exception the are yet. versions

As we old table the the calendar for many conversations into from coming year, to moving new move versions. new back to customers on are

time that to and have for the had upgrades. these Now they budget plan

even sales quarter full during terms QX excluding excluding related Systems, previous PMS-related is X-X, PMS XX%, and sales in With year Property Management is higher and hand, fiscal the from was On modules, that than XX% the one to anything PMS and for value other our PMS, contract of best add-on measured for was Sales annual prior go, record modules related Marriott pertaining sales BookXTime. the all-time sales BookXTime, much of as year modules, the as XXXX quarter far any by the comparable of best None includes to XX%. quarter. PMS so ahead reported already left sales year of best full agreement. PMS

for POS. Fiscal services with disappointing to be turnaround the the lot U.S. managed manage respect quarter and Sales beginning the happen to before. a APAC gaming in compared in was to vertical QX excellent simpler levels The proven more food as the sales, has about new, straightforward domestic XXXX transformation remained vertical. to cloud-native same another at to process old including modernized from casinos and to sales with the technology EMEA PMS regions

However, it we is QX for are not currently January international several sales us surprise working international opportunities record in these if to both on one March regions. current substantial sales. And quarter will this a

and We are brand progress. opportunities as a make base we but solid steady customers, international reputation are our and of to More will making efforts. with build continuing come good referenceable slow progress these regions

at end and and we sales, was quarters into final last global the X international sales ahead through continue of first as the well year. April Despite overall fiscal pace quarters, XXXX, December see of move to the the we year's POS ongoing momentum of X of fiscal quarter challenges record sales with to

for is which new an products fiscal XX X customers average added of subscription-based. October them During XXXX fully each, QX, and high. a December, customers These new we to XX up were signed record of

our subscription-based. the added In have which customers new properties and customers, company our the new new the XX quarter any products partially XX across was addition, we Of parent either XX of customer. parent already but properties new did before, properties, not of or were add fully current during

sales in properties products year, one instances buying product record instances year fiscal new in new in use. continue to the trust With history at already of at already of pace. XX product our is X the XX least a best for XXXX a products sales, Customers full using one products. our of our sales. us, remaining respect to additional quarter other have products to of sales which XXX With of new involve These total least there at were

much customers who discovered translate as call, earnings yet. Like we who the hard new our of only success, of we are are history well, industry new continue know known with has the and Agilysys more to hospitality having We that fully with before work well in now the not to familiar product customers becoming as to recent said last have innovation. not

a and customers. medium-term long short- of and both existing growth revenue promising ahead new have us, runway of with sales and customer with the We base

at demo currently sales the the plus measured on sum sales stage value of started all pipeline previous global this we product December a since contract least working at record years couple to XX% current demonstration value a of the Our reached which is at are ago have level opportunities compared tracking we the end as of now and same was time year. higher annual

and POS compared This to XX% ago. December year sales XX% opportunities, pipeline time same demo as plus and respectively, for X PMS end of higher was the

but even be remains strong, can stronger. sales momentum Our it

more doing Our installations of this. are getting better, be lot but we should a

but continue new good, higher. These the of customers are for we work of growth can plans focused be year. the year is and as are into far areas next the fiscal this on our quarter number move final we Our on

that growth software On of was proportion to record revenue be a prior on one, subsident $XX.X challenged is XX.X% licenses. XX.X%, revenue one is [ an not increasing cloud than revenue product now of XXth quarter, and the profitability. is that of the consecutive due forms expansion lower Fiscal was engines. Perpetual continues portion business Product record ] license be to involving million, revenue XX.X% expected ] main [ X-X, year. higher QX based was X our XXXX Product factors: which comparable than $XX.X a million, the future to revenue, XX.X% to which X-X, is QX revenue revenue quarter. year last

systems, reduced hardware attach software because POS now enabling Factor iOS sales product devices number major to dependent has not have unit POS Android, which POS like challenged is each of the a us. recent operating number past. iPads on portion factor the through or version hardware in two, of support rate customers Windows, three, sales, revenue the been all recent And directly buy and and terminals

While improve in expect we near to product remain foreseeable revenue future. expect for POS to term, sales the we challenged the levels levels

revenue teams. a postponed few during And revenue December foreseeable to to major was to on into December previous as we've PMS Services of services hiring quarter X implementation X-X number future. million, as that Reason Services back implementation grow subsequent prior backlog substantially goals number expect few for was affected compared extent by for larger and for reasons: billable been we were realistic size and we customers realistic part phase. was quarters projects $XX.X months. working a than deployment been significant and our during several past the more levels. the level, to project services year below XX.X% moves completed along Fiscal revenue now project record that but at months three, services meet development planning and months reason our XX.X% to a the product is has margin enhancement the now again, high to more one, two, XXXX inability our by is work a the X-X, expectations expand continue comparable million, to $XX.X the the higher quarter, this strength QX

currently are for ways to teams. increase on We the pace services dining working

overall recurring The is revenue record in revenue total revenue million quarter. XX.X% subscription XX%. least Fiscal was recurring now Recurring period. This highest now. year-over-year year-over-year year-over-year X.X million. XX.X% of of reached a record prior this Subscription revenue revenue the is year revenue level increase million, a Within QX of higher XX.X% of subscription prior subscription was revenue, subscription high. growth a quarter. quarter of Organic the the was year-over-year consecutive than was record comparable year revenue is Xth higher a at comparable than XXXX was which million, The recurring increase was $X.X revenue XX%. $XX.X recurring $XX.X revenue, record the growth XX.X% till total revenue

close revenue buy the more modules, of during pertaining fiscal of all by XX% modules revenue the including total BookXTime, sum subscription pertaining year. related grew the XX% PMS by growth POS and fiscal year-over-year, first to of year-over-year. X than quarters a POS and PMS-related previous revenue point while XXXX to grew the PMS-related Subscription subscription sale, of to not during lot grew

from created subscription both add-on of denominator, years, POS revenue. revenue. constituted modules revenue Removing several modules both are only equation, the Including the across BookXTime in during XX% recent were the most total subscription revenue of and PMS and numerator subscription past add-on BookXTime the of total XX% from subscription now which

software enterprise products we in and expected. based the old installations, became We in done only the from which year. transformation for All POS stages to fiscal be success world. this versions The modernized product several seen underestimated masterful often to than sales challenges the well. are achieving with those challenging a success a reengineering near past such of teams extremely rate and reengineering development our of XXX% have product done massive This effort. years, kind the rate new product difficult with is projects, job Over exercise onerous creation module each and new modernization not the had going very completing are more recent on transition-related

Most total expect Vertical. to mainly fiscal we of the fiscal headwinds Food faced line are We have this in revenue revenue full sales year the now XXXX challenges, year top POS Services related be to $XXX million. these Managed

to the -- levels expect previously revenue growth. previously and for subscription achieve We profitability the provided guided guidance

to financial on more for Before on PMS over Marriott handing Dave the our project. quick the A update call results.

vendors mentioned the by detailed are this we vendors be All the of development towards end-to-end test regarding ecosystem significant installations parties. earlier in testing past in performance phase, project. next preparing followed second As few the have year. phase details and initial transparency we project across involved there for high all now degree pilot expected the will calendar working is a moved a all property of This which includes collaboratively call, and half of system all properties, among and the

With Dave. that, the hand to over let call me

Dave Wood

look results, our Thank a financial income you, at statement. with beginning Taking Ramesh. the

a was compared comparable X.X% of was record net XX.X% a while professional million, recurring $XX.X year revenue to prior in services XX.X%. quarterly and revenue prior of XXXX year Onetime fiscal quarter product revenue total up the quarter, revenue the increase period. of was million from Third $XX.X consisting down

transforming work continue through We products. of to new versions modern the challenges of our

phase this rollout we development and major planning beyond a quarter are as move seeing We for the revenue also the customer. start of impact

[indiscernible] with for X growth. our at future healthy sales levels However, bookings strong remained momentum revenue

be reduction record which Our headwind a revenue, levels. the XX% second The product backlog the biggest during the last to fourth business expected. originally down a be product challenge near been half Onetime of to significant fiscal year, fiscal at compared the year-over-year XX% through larger the the year in will continue revenue quarter. year remains total we has fiscal will to than full

million $X.X by effort on still Although margin of up was large years. services of drop with short development year are in bookings been fiscal year year gross XX.X% to couple services we've reduced the expectations, over to during QX when $XX.X over low the XX.X%. point-of-sale quarter related 'XX. to The at services million of the Professional point past working prior increased 'XX. compared QX the fiscal largely Professional

the wrapped now up environments. have We the initial majority of development

moving phase our shifting development are major the the focus rollout We of the phase and past to project.

services will see in rates. revenue but project at reduced services development some revenue related to normal We level, associated growth continue a with line a with more bringing significantly large

Typical of large the services increased levels. projects Professional timing years. QX, impact during more record called quarter fourth where Services projects also prior several the into revenue caused to holidays again Professional delay the than backlog once some

QX to in last Fiscal revenue in compared net revenue Subscription of represented to XXXX the quarter XX.X% of recurring Total of of XXXX. fiscal subscription growth grew recurring quarter third year. quarter recurring revenue compared XX.X% The sequentially third the for third total year and total total rates. best XX% fiscal XX.X% third subscription $X.X fiscal quarter for revenue was continues second XX% year. in QX comprised to fiscal XXXX. of sales fiscal over revenue over subscription backlog the full our increase the of XX.X% quarter subscription history. to million trending 'XX quarter for the our the Organic the fiscal increased quarter Subscription exit from revenue XXXX. was fiscal XX% revenue

third Gross remain prior profit to $XX.X year margin fiscal of in fiscal should the total to XX% was just the compared gross statement. income $XX.X margin XX% north of Gross comparable XXXX. full profit the million XX.X% down million quarter. Overall, Moving for compared was year. in quarter the

expense XXXX the in quarter. third marketing and when revenue XX.X% in line expenses the product year compared operating and main of general the prior compensation, quarter stock-based items, sales Combined, XX.X% X development, and revenue administrative to excluding of fiscal were

XX.X% of of prior of of to Excluding comparable to XX.X% expenses XXXX during while compared and to XX.X% year X.X% of revenue QX year, fiscal administrative the marketing to increased decreased compared development the in decreased in XX.X% XX.X% stock-based QX. and compensation, product to comparable fiscal revenue. revenue revenue General fiscal prior from revenue of sales

net share due prior was income $X.X third of quarter $X.X for the share ] and improvements $XX.X year $XX.X quarter of Operating a prior of $XX million million over value was $X.XX. the certain income diluted net million, [ diluted earnings of for of $X.XX, million GameCo allowance gain the respectively. noncash in reduction the income adjusted the third third million year compared charges million, $X.X and release net of quarter. and $X.X and quarter million year nonrecurring Adjusted normalizing of $X.XX primarily to income result to in and both per $X.XX prior were The

the adjusted third quarter. EBITDA $XX.X was $XX.X compared ago year For quarter million in million the to XXXX

to in FY pleased We being original coming well are our see levels EBITDA ahead of of adjusted plan profitability at the revenue. with XX.X% 'XX

December March of of related marketable cash statements. The acquisition cash with to as as million securities million of $XXX.X XXXX, Moving XX, flow to hand. was decrease and XXXX. and portion cash balance XX, to BookXTime $XX the sheet compared the paid Cash the on was

we million As also our revolver acquisition. through a the $XX credit to reminder, BookXTime fund utilized

$XX.X prior As million of Subsequent December have $XX.X down the compared million. year down flow the $XX XXXX, in we million Free associated quarter million fiscal end, $XX of additional QX we in an paid was XX, cash debt. paid the to comparable to quarter.

$XX.X X $XX.X compared of XXXX in year million cash the to months flow the For prior first year. free fiscal was million

to to and associated $XXX the free lower fiscal led due guidance growth in profitability past, course flow of to costs adjusted remains least business challenges plan at proxy subscription the Despite our Onetime the have As revenue million, the continue good XX%. over us revenue above though to be we reduced with year. annual for cash EBITDA is said this, expectations. lower

revenue current growth. closing, financial and challenges fiscal reflect foundation that for future the XXXX some QX In year our results solid short-term affirm

call With that, back I turn to will now the over Ramesh.

Ramesh Srinivasan

let phase related now. transition headwinds tough line have In related that year reiterate you, are only faced the we summary, are the Dave. top this me revenue to Thank fiscal we

As modernized which behind which and set new we technologies advantage. era given of we dependent of we older a a ecosystem lead using hospitality-focused of a created have a unified on for has technologies, have cloud-native us software integrated entered tough an decades were competitive couple of distinct duplicate and modules, to

better. We the for Fiscal and record keep XXXX is challenges still have sales side in a year equation. on was of the been year point-of-sale underestimated mind the a pivotal us lot sales a fiscal that transition, that massive in but we should could POS XXXX

lot In of the a hiring addition, could we services speed for teams. have the implementation done with also better

on more issues, the We challenges caused are headwinds on to and now that structural realistic cannot other to significant in no issues. services are changes macroeconomic growth We these any reason. no external revenue competitive focused forward. the return expect There environment, have moving No challenges. blame levels professional no that

before. are than growth of rethink our us Nothing none that. Our stronger business any ever will of require that of fundamentals any now business investment strategies, and ongoing to

Our and profitability steadily our continues and over be term. be further medium leverage good more to are levels improved can operating long effective the as

any needs The market remains sacrificed We fuel addressable size have to huge. total profitability. not growth-related

to we've enterprise only to run credible where in Systems We a PMS, on confident profitability. well. progress getting major our project PMS to the started. Management Property been now our and The are journey a balance in how which presence organization, We disciplined growth growth arena, remain is software continues growth working world-class ability knows

are old short-term and nothing challenges it. through working to fiscal new less. implement, customers to a They to doing easier reasons grow. the product about The in field. and is for and shareholders. that and Nothing be thrive future are good the position to modernized unified They of support excellent sets bullish versions employees, newer We underestimated our give year, us transition well are are this of some our more this in and We phase our transition enhance. very

end for up questions. that, up call With the let's open to

Operator

[Operator Instructions].

Craig-Hallum. question Sutton with comes of Our first the from George line

George Sutton

point, project. Ramesh, project? about our if been I talk to in it walk wondered tell the you going we give this which changes? scope at some that train that. if I have of just about be we does through you now component just overall you model, But services would major there could that believe with any sense pursuing the us we're could Have a little less suggest to were process us a development this. What trainer

also, little mentioned that a there then And you pilot us a be few a basis? more the Can significance just will you base. detail on properties those test of than give

Ramesh Srinivasan

Yes, George, this you changes time. is telling we are what have news been project there this about good from the all no major

Given involves all big massive a it major a it transformational vendors. how project moving that has remarkably gone and for multiple project It's is almost parts, plan. customer. And on so well exactly them a with considering the far

this a needs now are now. we phases, lot substantially would thought which setting development needs And product needed what development into we at get of over So moving exactly that which -- system planning and performance to where -- there deployment done, all are we ecosystem is was time. be -- the

the half and from there. of of go second this And we the second expect live pilot in then what we calendar to XXXX, test is year properties, proceed followed by half sites in

one involved other to seats is at being multiple it Marriott. table. the And that thing the all a parties. and across So was vendors good going note have lot There way in we that managed transparency all it is well this. planned. by And vendors very obviously There's are exactly of the

what are of And We remarkable all transparent. there's on. all parties. and degree are a the details the all of going cooperation among aware We're coordination is aware,

So things well. on are going

George Sutton

you that which on you on it if is dependent mentioned opportunities. that's is won't this the be You some record Is dependent the winning it this that pipeline Or a decision surprised something near-term of you anticipating are timing more winning? important? that would suggestive be international is quarter quarter? of What

Ramesh Srinivasan

news the it the and we still that singles enough a last characteristic of not of is sort and sales couple opportunities few is few international for home doubles. fruition next I come been which that significant that news on have there of sales the is And both during to quarters, George, and should on think dependent hopefully loans good few working a months. See, are

chance March, quarter a that record January through be is quarter, could there for So a international this sales.

build which a But doesn't rooms. doubles, get singles that We on. solid to out the pipeline of are of door still working we still and need

are our We building reputation.

matter develop hits, home but But kinds big do when it happen in We our dependence to runs. the increases wins presence. international regions. our singles big because on of need and the are relationships is big We increasing still these the they doubles the more

George Sutton

if I other thing, One could.

And the necessarily you new you is bifurcate Do international. opportunities opportunities not as on domestically versus curious side, you the feel on I'm many mentioned new better you based that as see? Agilysys? you on as should seeing You side, Agilysys and would the other the can think to then therefore, if is my like. you broadly appreciated assumption seeing not as still should the international domestic you're you're known

Ramesh Srinivasan

Yes.

the hill a question have is We that And a domestically. domestic of there X no international. reputation is new to the have of terms the climb. In to Agilysys, domestic and already lot X hills George, X we reputation do shorter climb,

well reasonably known, well We are known.

installations we Agilysys, trying new on them unified more as meaning that, are spread of are of the message new new -- the the native of and modernized spreading. cloud getting go message for solutions they we well, and getting the Agilysys. new keep to continue new done the the based we and Now more -- are the installations, of And modernized to lot versions, a

those and only hill climbed that to have there, before. to name on provide we're That the reputation establish customers we just will is that higher of big lot much because build. news. Agilysys around as a establish that a do Agilysys of didn't the to new opportunities And we a is the referenceable working we the provide us can have big will Internationally, name sales Not projects, well. whom we then of of us lot have

To it in domestic is answer than definitely process your easier an question, internationally.

George Sutton

I'll to it leave others.

Operator

standby next for Please our question.

next comes line Sam the ] with from Company. & question Valves Our Needham [ of

Unknown Analyst

on you were tonight. quarter. I here than the to they first I'm know POS but Mike wanted said they just hopping still for sequentially. better on in touch the I the quarter, sales declined

I'm coming So talk could gives get that you are the going quarters if the these throughout the better curious just about and in guys you what to confidence trends coming year?

Ramesh Srinivasan

Yes.

So our on confidence pipeline that POS refer is that told the pipeline working sales will crucial Like pipeline. internally metric we based plus [indiscernible]. as demo there continue manage on one that improving you, is we we to of are we

of demos So demos opportunities, [ those product call sales product runs is into we that, has which least on we where we have reached demonstration within Plus But of product for the a going at pipeline are the where and ], hundreds subset our pipeline stage, focus asked customer sales millions on. of dollars. that the

calendar higher like XX% the compared something Now higher. same time XXXX December end PMS to calendar POS that is is pipeline end for is PMS with meaning XX% but year, like higher, December XXXX. XX% than last

significant We opportunities. working through of POS sales a are lot

which the much us, clear since QX put We've One will comparing too QX the now. I to And is we us are quarters, struggled bottom for coming focus couple quickly of Now during And was QX versus on are sales POS on sales gives would opportunities are few then, point. reasonably improve the point. we versus sales confidence with there fact POS climbing working hit the not upwards. that QX. significant quarters. of a definite a thing things back low QX

Unknown Analyst

Got it.

the guys how signed about were in quickly And parse logos you XX these quarter. helpful. verticals which maybe follow-up then subscription just in, POS Okay. many a markets just and versus on That's the talk out quick PMS? you Could new what were

Ramesh Srinivasan

that usually of that like together. for of portion which products, us. good each them POS highlight and main the high both us. of involve them is A were And X involved is it purchase for them Many of record a was probably POS, of PMS

anywhere been number all We close and high customers have never was X for X new an us. across the record on average that a to

customer who and most involve POS each us several And to of PMS. came both So products. them purchased

PMS POS in So more was than that.

don't of but know for which sales customers In was of, vertical across all no all them. I our terms It verticals. verticals, new highlight it verticals. could involved involved exactly There you. they particular where more vertical all were There of were I

Unknown Analyst

Yes.

Okay. Good jump hear. to All back I'll right, thanks. in.

Operator

question next line Ivan the from of akin Oppenheimer. Our [ comes with ]

Brian Schwartz

for contained about, is This you the point-of-sale categories? Foods that Oppenheimer. in lot that a bookings of terms is the Brian Schwartz talked weakness other in or in mostly happening Ramesh, it those Managed Category is

Ramesh Srinivasan

that doing it -- it other of challenges major be was mostly could the mostly they But to [indiscernible] It cannot of the verticals, better. majority offer well, would terms is which these as answer large IT of and the had, that in Service it's been in the They places because Brian, as large part, that also say vertical your question, in we've carriers, And Managed are the Food a part huge of the Managed Food the in Services restaurants have vertical. don't greatest right? I have all IT verticals FNB are the markets in in end other huge for well, Vertical. departments. lower Though support, the

simple to POS. to to to They all be requirements They be the have in simple very to the to are Those products upgrade. install. be support. have have So simple

than transformation completely through, more upgrade products But complicated coming this used the the installs should mostly took and systems unify but on it since Service we passed Manage be, of POS sets our and as how and it that's it new of reengineering which to of into the was be, also and vertical. cost was became a to that Managed staff-facing Food cloud-native Now massive some the getting and are enhance feature to opportunities being simple back lot to are in we now it in guest-facing support.

Brian Schwartz

Okay.

And source you acquisition. on installed a Ramesh, that you're the hiring for rep acquisition organizational hasn't are a focus to greater that in comments, does like been sounds primary on cadence introductory changes next customer the up the you customer base. or My in for go-to-market next on, from of I on the greater is, either the of sales or question Moving know other scale bookings, looking planning more Are putting the structure new comes the year? any capacity to for that, of leadership to that's change make focus you your support the year? motion your more the hunters

Ramesh Srinivasan

Yes.

more it's customers are acquisition are lacking territory getting So ensuring thing more on we we the which yes, Brian, the doing customer and been is we where fundamental newer full is before. focused have on coverage, focus, now

we are current customers. a lot are we to continuing our -- of Now to from sales get going

We relationships with us we for them. that our and been have long have a very products, modernized all great happy they have They're with very time.

more product to to one selling with at to is least increase. products new continue the sales, of customers going our products So

Like is remarks, quarters I opening already said our year. in my in year, this best X this

We we previous of ahead far have are full go, X and quarter year. to

and as come going from So our to more lot continue. well. that new is But sites a has to success new customers

expand better are current I years, a team have did doing we second the half team couple that X with growth what the or still can Number the a lot last sales than room over of things. our We one, we do today. of the they sales for Now sales X plenty call of sales have and would team.

the have there expecting that time now So a gone to that. are sell, products are the the through They we from and them. lot more ramp focus is on all

sales sales is growth thing current there first is the plenty of team. for So room the with

area, There Joe and sales of thousands sure are our territory. teams are especially expanding Now to sales the on focused properties we focused the hotels is ensure are full at and focused are moment, resort on that in still making touching team coverage. not territory we we expanding Youssef and on cover properly also the we the

the sure more want easier becomes make newer sales all helping of we rest create the teams focused the versions, for sell. sales. to it are Now that lot so customers referenceable to We a on with

[indiscernible]. So we all those focused are areas, on

Brian Schwartz

for follow-up one And Dave.

here you've times. has as methodology the you taking are guidance, been injecting had a same guidance more given are conservatism couple before? the down walked on you a Or Just the of little

Just new kind still getting you're that a of pipeline this new of questions looking the a or is at. lot whether guide

If appreciate share on methodology, that you could I'd it. any color

Dave Wood

remain as of then to without would quarter shortfall. subscription to shortfall revenue product of I service next bit. consistent a where very I to and couple it quarter, used pipeline our we the will obviously about kind of product XX% holiday up left mean, with of obviously, in mean medium-term a months through the I doing. well the opportunities lot the today, some to guiding. mean way feel it's is and short think pipeline. we're about going only I kind about little how seeing commentary the we -- impact the gave a the I normal guide. likely to not Services up and improve of maybe a But get of you're expect growth some the of is make strong you Ramesh to

in But change mean, I X hard going methodology. feel and onetime the just not ever pipeline as medium of revenue. to with quarter we make short would a be have up strong the there's to as it's about term our we Agilysys. in But say I

Operator

standby next question. our Please for

the next line comes Our Nehal Northland Markets. question of Chokshi from with Capital

Nehal Chokshi

in I that, could but something, Ramesh, XX% year-over-year. didn't that please? up you catch said prepared was you what remarks, your repeat something

Ramesh Srinivasan

said are pipeline referring sales We made, -- to the comment you we Nehal?

Nehal Chokshi

yes. so, believe I

Ramesh Srinivasan

Yes.

So.

Nehal Chokshi

the or PMS bookings? some of sort about Thinking bookings

Ramesh Srinivasan

Yes.

to you're referring to the growth. referring are or you're bookings or the referring the to We sales revenue subscription pipeline

me that cover let So quickly. just very

and the quarters end us. is PMS-related about already for of full at PMS modules, Let's X a bookings booking sales record add-on talk year first.

modules of record a add-on is PMS year as record sales of full bookings us, far as concerned. and PMS-related are terms for in So

Now without about XX% of BookXTime, last if out QX. sales you higher of remove QX BookXTime this numbers the than modules is and related PMS it,

have and you XX%, than last sales not modules in just QX we this in QX. but there That's The we including started up of included October our By was higher no this PMS. take XX% So one that thing add-on and all all is year's sales. PMS X-X, add yet way, sales the to this Marriott sales December mentioned. PMS during

best and previous modules best already of ever mentioned quarters BookXTime, compared full is related that X PMS including in We to our than also mentioned the We XX% higher aspects. year, those And sales year. only the that year that at this of the and pipeline both said last sales we end is same count than have higher products. reached also stage year. December pipeline demonstration PMS XX% we PMS about time,

the those mentioned. we are think I X things

Nehal Chokshi

of rates? XX% Is is of great. be a up tracking timing? to Yes, result run clear, excluding which result Or year-over-year, that pipeline And way just BookXTime growth. a ahead that is of bookings, your that's increased just is PMS

Ramesh Srinivasan

is of PMS up with you additional completed now. had XX% lot it before compare we actual And sales It also done That customers. customers year year, higher our have with with POS is last of new tracking didn't we this is is QX to be flying And that products. who buy where because would terms Yes, that a QX that signed PMS just is well, X-X, signings in pipeline. we wish customers. sales higher ahead products signing of

Nehal Chokshi

then bookings. And module about rate out PMS you again that December Yes. the talked for you metric give for in Can quarter? attach the past,

Ramesh Srinivasan

And mostly from modules. which along rate it the signed new for customers, of about modules. sign. X attached to goes PMS sign ad attach deal, bought that we about for a X is we modules us, high said a deal we have of Every what newer the an record X products X average is us. generally, PMS It's the PMS about Yes, add-on modules we X.X time per customers with

Nehal Chokshi

is then And Okay. that... question last my

Ramesh Srinivasan

you PMS -- more have POS. sorry, may more with have we modules Go we than with And have add-on ahead. have -- we

Nehal Chokshi

whether new got used Agilysys you for in TAM get that these to you be going Understood. used incremental this core or billion through that that is Yes. then type can us TAM your $X expectation the markets billion the slide share $XX think of from you you've addressing a market identified? Can take now where billion. you level and months a you're $XX not ARR the confidence same adjacencies what is to you've to And really is cite ago X the

Dave Wood

new the I stand-alone Bob current lot we feel we call rolled in that -- any they're had Nehal, given products not mean, are add-on the ] TAM keep market the a market. like point. are modules, of our really mean, TAM represents add-on modules. I to competing Yes. add-ons most XX in [ with mind, them these but at of people the in we

of competing roll X the compete to years weighted most our are in. of a kind had to methodology. best-of-breed that just that now practice they to a expansion or until But ability add-on on best of So modules X TAM we really as in breed is were the rolling after

Nehal Chokshi

And that's Okay. share basis, be to the market markets, lower [indiscernible] to expect on you would markets? far have incremental a share market on continue your market But implicitly, incremental core you expected. your then longer-term core of currently, TAM less this share current than on

Dave Wood

less we ] a No. I have market. I today. I mean add-on have near -- mean, such mean we're market about room expect PMS share talking we mean, X than rooms -- still million core, low we whether I you're in or [ XXX,XXX a

on like And plenty modules. and there's the talked expansion X in of last core core a just our over add-on starting the years, of Tier obviously, in about So our best compete we're of couple solutions. lot we've to our breed

of take and over we the medium So the think more and across term. limitations, butting like board, feel up penetration we'll market we don't we're against short any share market kind

Operator

William line next with of the Out from question Stephen Sheldon Blair. comes

Unknown Analyst

two, clarify should mean have you for thinking line I the and to then the with be rates growth questions on a normalized into in Sheldon. light for fourth next for Matt the about professional ] you just gross we the service how one, with next challenges point-of-sale, margins Dave. [ wanted model start couple what more looking of You Stephen year by in of into Flick quick sales can quarter item year? activity? And Number

Dave Wood

Yes.

has first mean, thinking of time. growing over cross I kind gross subscription we've us, transition mean, at of been -- as the the into look over or business. It's margins the X they So for base. a to into we years made of margin a we year the went the for XX% last gross been this more X kind obviously I

we're a XX%, margin XX%. X% jump, are to continue the Now I expansion at X I X% from would you going or don't to I margins into so a That gross XX% mean I point think see feels where next gross incrementally. or there's trending would gross but going to be up us. I assume would mean, more closer year, normal will grow think to today they margin.

we'll product in margin. go back the think change with high XXs the in XXs to low So don't I gross down mix, or

revenue. XX% line normalized some professional the -- mean I service way services then normal XX%, grows type we've of about we that couple with obviously, had so and services really, last growth, kind of for which not is is is major had And top development, the is the professional us. -- think we've the line services And a quarters,

line. top professional expect line to grow in services with We

So level. year. this kind out same top onetime of anomalies the the grows of professional we've Obviously, fiscal if some is probably line growing once XX% to had backing around XX%, services

Unknown Analyst

this on Got somewhat to then both wanted it. but addressed context I it. on already, back of was Dave, just Helpful question those. circle And

there Marriott on that pace rollout a the you for So planned share may the particular initially rollout, regions there deployment? can perspective? anything from you that in location focus And any are is of then

Ramesh Srinivasan

Unfortunately, Matt, cannot. no, we

go that There's sites can best calendar very of is half it we expect So now are well unfortunately. can managed of XXXX, degree pilot the test live. across is is is we being and you project what tell the in second the you the well. tell we parties, a to going now, transparency properties best and high all That following the and

Operator

for now the call Thank you. turn I'm further to remarks. and Ramesh over I closing like would queue. Ladies gentlemen, showing in the to no questions back

Ramesh Srinivasan

Towanda. and safe again to you a for your be XXXX. interest the of all will Look for wishes of you, full Thank up fiscal to you happy, you. Thank forward and catching May Best very healthy, successful all when Thank results. end XXXX around middle to year we and reporting support. QX

Operator

your for participation. Thank call. that you gentlemen, concludes today's and conference Ladies

You disconnect. may now

Agilysys (AGYS) 21 Jan 252025 Q3 Earnings call transcript